Eden Sunshine | Crain's Phoenix

In this ongoing series, we ask executives, entrepreneurs and business leaders about mistakes that have shaped their business philosophy.

Eden Sunshine

Background:  

Phoenix-based Realty Executives was founded in 1965. It has 28 offices in metro Phoenix and more than 900 “executives.” In 2017, the brokerage completed $2.7 billion in sales volume.

The Mistake:

Believing that I needed to micromanage people in order to get optimal results. I had grown cynical of my people and their capabilities, which caused me to monitor their every move.  

However, I couldn’t effectively micromanage everybody. So, I had to let go and abdicate responsibility to others, hoping that they would meet my expectations. Micromanaging limited my ability to focus on the growth of my company. 

At one point, I met with a business broker. I was thinking about selling my company at the time. The broker said to me, “Your business is too dependent on you. If you were to sell it, there’s a very good chance that the buyers would want you stay here.” I thought, wow, that’s pretty counterproductive. It became obvious to me that the day-to-day functioning of my business was wholly dependent on me because I was so involved in everything that was going on. 

That was the moment I wondered how I could create an environment where my people could be empowered, work effectively and produce results, without me being intimately involved in their activity.

I went from being very distrusting of my employees’ performance to having absolute trust.

The Lesson:

I learned that I needed to develop systems that would enable people to be more effective at producing results. So, instead of allowing the information to be in their heads, or be random in terms of results, I had to develop a consistent, predictable methodology to how we did things. It had to be grounded in producing a very specific result. 

For example, I was micromanaging all of our sales activity. Our goal was to maximize the conversion of a prospect during an appointment. So, we developed a system, analyzing the process by which we would sell. 

After creating these systems, the next thing was to create an environment of accountability. I figured if I could trust my systems to work, the next thing that I needed was to trust that my team members would actually follow the system. So, we made a very specific agreement with one another: If you agree to follow a system, we’ll expect that you’ll do so — not if it’s convenient or because you feel like it, but because you said you would. If you’re unable to follow the system or do an assignment, I just need you to communicate up front, so I’ll know what to expect. 

We created a wonderful environment of trust and accountability, just by making a very simple agreement: I’ll do what I say; you’ll do what you say. If we can’t keep our agreements, we’ll have a conversation about it. 

The net result has been quite phenomenal. I went from being very cynical and distrusting of my employees’ performance, and thus having to micromanage, to having absolute trust and confidence that their effort and work would end up producing phenomenal results. It really empowered them too, because they took ownership of results, versus feeling like I was always pushing them. 

As a result of creating an environment where my people were empowered, it enabled me to shift my focus to the things I do best. At the time, we had basically been stuck at about $3 million to $3.5 million in revenue. As a result of the work, we were able to move the company in the direction of closer to $12 million in revenue. That was largely because I was able to let go of my involvement in the day-to-day and was instead able to focus on the growth of the organization.

Follow Realty Executives on Twitter and Instagram at @RealtyExecsPHX.

Photo courtesy of Eden Sunshine